Prizor Viztech

Risks

• The company is highly dependent on certain key customers for a substantial portion of its revenues. Loss of relationship with any of these customers may have a material adverse effect on its profitability and results of operations.

• The Company has entered into related party transactions in the past and may continue to enter into related party transactions in the future, which may potentially involve conflicts of interest with the equity shareholders.

• The company propose to deploy a part of the Net Proceeds towards acquisition of shops which is not registered in the name of the Company.

• The company has certain outstanding litigation against it, an adverse outcome of which may adversely affect its business, reputation and results of operations.

• The Company`s manufacturing activities are labour intensive and depends on availability of labour. In case of unavailability of such labour, its business operations could be affected.

• The company generates a substantial portion of revenue from the region of Gujarat. Any adverse developments affecting its operations in Gujarat region could have an adverse impact on its revenue and results of operations.

• Its Revenue from sale of CCTV contribute significantly to the company revenue from operation. Any loss of business from such products may adversely affect its revenues and profitability.

• Majority of its Revenue from operation is derived from the company assembling activities. Any disruption in the continuous operations of its assembling facilities would have a material adverse effect on the company business, results of operations and financial.

• The Company is dependent on the continuing operation of its manufacturing facilities. Any significant interruption in manufacturing at its facilities could have a material adverse effect on business, results of operations and financial condition.

• The Company had negative cash flows in the past years, details of which are given below. Sustained negative cash flow could impact its growth and business.

• If the company fails to maintain an effective system of internal controls, its may not be able to successfully manage, or accurately report, its financial risks. Despite its internal control systems, its may be exposed to operational risks, including fraud, petty theft and embezzlement, which may adversely affect its reputation, business, financial condition, results of operations and cash flows.

• The Company has higher debt-equity ratio which requires significant cash flows to service its debts obligations, and this, together with the conditions and restrictions imposed by its financing arrangements, fluctuations in the interest rates may limit its ability to operate freely and grow the company`s business.

• Its expansion into product categories and business verticals and increase in the number of products offered may expose it to new challenges and more risks.

• There has been delay in filing of forms with the Registrar of Companies as per the stipulated timelines prescribed under the Companies Act, 2013. Any penalty or action taken by any regulatory authorities in future, for delay in such compliances could impact the reputation and financial position of the Company to that extent.

• Its Registered Office, workshop, warehouse and branch office are not owned by it are taken on rental basis. If the company is unable to renew existing rental agreements or relocate its operations on commercially reasonable terms, there may be a material adverse effect on its business, financial condition, results of operations and cash flows could be adversely affected.

• The average cost of acquisition of Equity Shares by its Promoters could be lower than the Issue Price to be decided by the Company in consultation with the Book Running Lead Manager in accordance with the SEBI ICDR Regulations.

• The company has not yet placed orders in relation to the funding Capital Expenditure towards setting up of Display Centre in Ahmedabad, Gujarat which is proposed to be financed from the Issue proceeds of the IPO. In the event of any delay in placing the orders, may result in time and cost over-runs and its business, prospects and results of operations may be adversely affected.

• The company requires working capital for its smooth day-to-day operations of business and any discontinuance or its inability to acquire adequate working capital timely and on favourable terms may have an adverse effect on its operations, profitability and growth prospects.

• Within the parameters as mentioned in the chapter titled "Objects of the Issue" beginning on page 85 of this Draft Red Herring Prospectus, the Company`s management will have flexibility in applying the proceeds of this Issue. The fund requirement and deployment mentioned in the Objects of this Issue have not been appraised by any bank or financial institution.

• Its trading activities are exposed to fluctuations in the prices of traded goods.

• The company has not made any alternate arrangements for meeting its capital requirements for the Objects of the Issue. Further the company has not identified any alternate source of financing the Objects of the Issue. Any shortfall in raising / meeting the same could adversely affect its growth plans, business operations and financial condition.

• The deployment of funds raised through this Issue shall not be subject to any Monitoring Agency and shall be purely dependent on the discretion of the management of the Company.

• Failures or disruption of its information technology systems may adversely affect the company`s business, financial condition, results of operations, cash flows and prospects.

• The company is highly dependent on its promoters and directors for its business. The loss of or the company`s inability to attract or retain such persons could have a material adverse effect on its business performance, results of operations, financial condition and cash flows.

• The Company has availed unsecured loans from its directors which may be recalled on demand. The Company has availed unsecured loans from its directors which may be recalled on demand.

• The Company has not entered into any long-term contracts with its customers and the company typically operate on the basis of orders received on hand. Inability to maintain regular order flow would adversely impact its revenues and profitability.

• The company could become liable to customers, suffer adverse publicity and incur substantial costs as a result of defects in its products, which in turn could adversely affect the company`s business operations and its sales could be diminished if the company is associated with negative publicity.

• The company operates in a highly competitive industry. Any inability to compete effectively may lead to a lower market share or reduced operating margins.

• The Company has limited storage capacity which can result in stock out cost and loss of customer adversely affecting its business and results of operations.

• The Company has limited space for its display centre.

• The company depends on skilled personnel and if its are unable to recruit and retain skilled personnel, its ability to operate or grow the company`s business could be affected.

• Its may not be able to accurately manage the company inventory, this may adversely affect its goodwill and business, financial condition and results of operations.

• The company is dependent on third party transportation providers for the supply of raw materials and products. Accordingly, continuing increases in transportation costs or unavailability of transportation services for them, as well the extent and reliability of Indian infrastructure may have an adverse effect on its business, financial condition, results of operations and prospects.

• The Company`s customers operates in various industry segments/verticals and fluctuations in the performance of the industries in which the customers operate may result in a loss of customers, a decrease in the volume of work undertake or the price at which the company offer its products.

• Delays or defaults in client payments could result in a reduction of its profits.

• Its success also depends to an extent on the company research and development capabilities and failures to derives the desired benefits from its product research and development efforts may hurt its competitiveness and profitability.

• The company depends on a certain supplier for its raw materials and other components required for its operations and the company does not have long- term agreements with suppliers for its raw materials or products and an increase in the cost of, or a shortfall in the availability or quality of such raw materials or products could have an adverse effect on its business, financial condition and results of operations.

• Industry information included in this Draft Red Herring Prospectus has been derived from industry reports. There can be no assurance that such third-party statistical, financial and other industry information is either complete or accurate.

• There are certain discrepancies and non- compliances noticed in some of its financial reporting and/or records relating to filing of returns and deposit of statutory dues with the taxation and other statutory authorities.

• The recent outbreak of the novel coronavirus could have a significant effect on its results of operations, and could negatively impact the company`s business, revenues, financial condition and results of operations.

• Employee misconduct including misuse of confidential data and failures to maintain confidentiality of information could harm it and is difficult to detect and deter.

• In addition to normal remuneration, other benefits and reimbursement of expenses some of its directors (including its Promoters) are interested in the Company to the extent of their shareholding and dividend entitlement in the Company.

• If the company is unable to manage its growth effectively and further expand into new markets its business, future financial performance and results of operations could be materially and adversely affected.

• The company may not be fully insured for all losses its may incur.

• The company is subject to various laws and extensive government regulations and if the company fails to obtain, maintain or renew its statutory and regulatory licenses, permits and approvals required in the ordinary course of its business, including environmental, health and safety laws and other regulations, its business financial condition, results of operations and cash flows may be adversely affected.

• If the company fails to keep its technical knowledge and process know-how confidential, the company may suffer a loss of its competitive advantage.

• Pricing pressure from customers may adversely affect its gross margin, profitability and ability to increase the company prices.

• The Company`s failures to maintain the quality standards of the products or keep pace with the technological developments could adversely impact its business, results of operations and financial condition.

• The logo "PRIZOR" has been registered under the name of the company. Any failures to protect its intellectual property could have a material adverse effect on its business. The company is, and may also in the future be, subject to intellectual property infringement claims, which may be expensive to defend and may disrupt its business.

• Its financing agreements contain covenants that limit the company flexibility in operating its business. If the company is not in compliance with certain of these covenants and are unable to obtain waivers from the respective lenders, its lenders may accelerate the repayment schedules, and enforce their respective security interests, leading to a material adverse effect on its business and financial condition.

• Its Promoters and their relatives have provided personal guarantees for loan facilities obtained by the Company, and any failures or default by the Company to repay such loans in accordance with the terms and conditions of the financing documents could trigger repayment obligations on them, which may impact their ability to effectively service their obligations as its Promoters and their relatives and thereby, impact its business and operations.

• Its might infringe upon the intellectual property rights of others and may be susceptible to claims from third parties, affecting the company operations and financial condition.

• Any increase in interest rates would have an adverse effect on its results of operations and will expose the Company to interest rate risks.

• The company is exposed to counterparty credit risk and any delay in receiving payments or non-receipt of payments may adversely impact its results of operations.

• Its Promoters and Promoter Group will continue to retain a majority shareholding in the Company after the Issue, which will allow them to determine the outcome of matters submitted to shareholders for approval.

• Its ability to pay dividends in the future will depends upon the company`s future earnings, financial condition, cash flows, working capital requirements, capital expenditure and restrictive covenants in its financing arrangements.

• The determination of the Price Band is based on various factors and assumptions and the Issue Price of the Equity Shares may not be indicative of the market price of the Equity Shares upon listing on the Stock Exchange.

• Significant differences exist between Indian GAAP and other accounting principles, such as US GAAP and IFRS, which may be material to investors assessments of the Company`s financial condition. Its failures to successfully adopt IFRS may have an adverse effect on the price of its Equity Shares. The proposed adoption of IFRS could result in its financial condition and results of operations appearing materially different than under Indian GAAP.